Beltline, TAD Bond Cases Return to Georgia Supreme Court


(APN) ATLANTA — Two companion cases related to the Atlanta Beltline and Atlanta Perry-Bolton Tax Allocation Districts (TADs) are headed to the Supreme Court of Georgia, where the TADs and the Atlanta Beltline are no new topic, Atlanta Progressive News has learned.

The first case, John Sherman and Christopher Eichler v. City of Atlanta et al., concerns the bond validation for the Perry-Bolton TAD, and is currently pending before the Supreme Court of Georgia.  Sherman is the President of the Fulton County Taxpayers Foundation, and Chris Eichler works for the Foundation.

The second case–John S. Sherman v. Atlanta Independent School System (AISS), et al.–had been pending before the Court of Appeals of Georgia.

It was recently the subject of an order dated October 23, 2012, by the Court of Appeals of Georgia to transfer the case to the Supreme Court, so that it could be heard concurrently with Sherman and Eichler v. City of Atlanta et al.

John Woodham, an attorney working on both cases, said he would be filing a motion for the two cases to be argued together during oral arguments, as well as for a time extension of ten minutes of argument on each side.

In 2008, Woodham successfully argued the first Beltline TAD case before the Supreme Court of Georgia, where the Court ruled that the Beltline TAD was unconstitutional because it diverted educational tax dollars towards redevelopment purposes without being authorized to do so by the Constitution of the State of Georgia.

The primary argument of both cases is that the City of Atlanta, Fulton County, and the Atlanta Independent School System essentially continued forth with two TADs–the Beltline and Perry-Bolton TADs–that were in fact nullified by the 2008 ruling of the Supreme Court of Georgia.

As previously reported by APN, Woodham is arguing that what the City of Atlanta and other parties did in an attempt to move forward with these TADs–that is, to amend the TADs following a 2008 referendum amending the Georgia Constitution to purportedly allow educational tax dollars to be diverted to redevelopment projects–was not legal because one cannot amend entities that have become null and void from inception as a matter of law.  

In other words, the City and other parties would have had to enact new TADs following the constitutional amendment, but failed to do so, presumably because they did not want to set 2010 as the base year for their TADs.

Other Atlanta TADs that use educational dollars diverted from Atlanta Public Schools would also be unconstitutional under the same legal theory; however, the bonds that are associated with some of those TADs are immune from legal challenge because they have already been validated by the courts.

At issue in the first case is the first bond validation for the Perry-Bolton TAD; in the second case is the fact that educational tax dollars are being diverted from AISS to the Atlanta Development Authority for the Beltline TAD, where they are accumulating.  The second case also seeks for those diverted tax dollars to be refunded to the AISS taxpayers in the Beltline TAD.

According to Woodham, the original Beltline case that went before the Supreme Court of Georgia, also started in a Beltline TAD bond validation case where parties intervened.

Although the Beltline has taken out one bond so far since then, AISS did not participate in that bond, so same legal theory does not apply.

The Appellant’s Brief in Sherman and Eichler v. City of Atlanta et al., a copy of which has been obtained by APN, makes a number of additional arguments regarding the unconstitutionality and illegality of the Beltline and Perry-Bolton TADs, some of which are explained below.  

Jane Hansen, spokeswoman for the Supreme Court of Georgia, told APN a week ago that the Court has not yet received the companion case; it still does not appear on the online docket search.

The case is on the January 2013 calendar, and so will be heard by April, Hansen said.  No date has been scheduled for oral arguments, although the Plaintiffs have requested oral arguments.

Woodham will be part of a team of attorneys who will argue the two cases that are currently pending.  The other attorneys for Sherman and Eichler are Robert Feagin and Irwin Stolz, Jr.

As previously reported by APN, Woodham is also the subject of a disciplinary matter that was recently pending before the Supreme Court of Georgia and was remanded back to the Georgia Bar for further review.  

However, there is nothing that would prohibit Woodham from participating in oral arguments at this point, Hansen said.

The Court granted both parties in the first case the ability to file briefs an additional ten pages longer than the usual thirty page limit, due to the complexity of the case.

The Appellees also requested a time extension of the filing of their brief, which was granted.  According to Hansen, the brief by the City of Atlanta and other parties is due in early November.

The other arguments made in the Perry-Bolton TAD case include another stunning claim: that the City of Atlanta’s new charter, adopted in 1996, does not include the authority to create tax allocation districts at all.

Appellants argue that when the City of Atlanta adopted its new charter in 1996, it did not include any provision allowing the creation of TADs.

“Subsection (d) of Section 1-102 of the City’s 1973 charter, the provision added by way of the  amendatory Act, House Bill 1634, was not specifically incorporated into the 1996 City Charter.  Instead, that provision was excluded from the 1996 City Charter, meaning that the Georgia General Assembly, by way of the adoption of the 1996 City Charter, expressly repealed House Bill 1634, thus completely stripping the City of Atlanta of any power to exercise redevelopment powers laws under the 1985 Redevelopment Powers Law,” Appellants argue.

“Nonetheless, the City of Atlanta has purportedly established ten (10) separate tax allocation districts.  All of these City of Atlanta tax allocations districts are ultra vires, illegal, null and void  and of no force or effect, because all such TADs were created subsequent to the General  Assembly’s adoption of the 1996 City Charter, which had already stripped the City of Atlanta of  any power to exercise redevelopment powers under the 1985 Redevelopment Powers Law,” Appellants argue.

Appellants also argue that the 2008 constitutional amendment, while purporting to do so, still did not have the effect of allowing for the levy of school taxes for non-educational purposes, such as redevelopment purposes; and that the school tax levy provision, which is also part of the constitution, now conflicts with the amended language.

Appellants also argue that the ballot language in the 2008 constitutional amendment was misleading.

Appellants also argue that a 2009 state law that purports to “retroactively ratify and confirm” any school board consent to participate in a TAD that had been in place prior to January 01, 2009, is unconstitutional and in violation of the separation of powers.

Appellants also argue that the original Perry-Bolton TAD was not approved by the City Council of Atlanta.


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